It’s interesting to witness the interplay between culture and politics which is, fundamentally, the interplay between narrative and power. Narratives that attract power tend to gain priority, which can lead to more power. Narratives that don’t attract power tend to lose priority and then lose whatever power they might have had. Successful narratives tend to attract more minds to propagate themselves to, adding power. Unsuccessful narratives tend to attract fewer minds and even lose adherents.
Successful narratives, even more insidiously, heavily punish those that don’t subscribe to them. Humans are narrative propagating machines; human adaptability can basically be reduced to the adoption of successful narratives and the rejection of unsuccessful narratives. The pressure to force everyone in a group to adhere to whatever narrative is currently successful is immense. Standing alone is an emotionally violent experience.
Author Michael Lewis became famous for the book Liar’s Poker. Liar’s Poker was originally an expose on the dysfunctional culture on Wall Street during Lewis’s time as a bond salesman at Salmon Brothers. Following the typical logic of narrative and power, Liar’s Poker instead attracted people to Wall Street. An unspoken context of Liar’s Poker implied that not only could mindless testosterone fueled jocks make their way on Wall Street without any particular skills but that they could make lots of money. Liar’s Poker became a recruiting tool and even an encouragement for the kind of Wall Street idiocy he had deplored.
As something of an act of penance, Lewis has written a new book The Big Short: Inside the Doomsday Machine. In it, he profiles four groups of investors who shorted the Housing Bubble and profited immensely from it. In an interview, Lewis commented that one commonality of these “shorts” was how socially disconnected they were. One of Lewis’s protagonists, hedge fund manager Michael Burry, was diagnosed with Asperger’s Syndrome during his shorting. Those who suffer from Asperger’s tend to have less social connectivity to others that is true of the average member of the population. Burry, for example, never socially connected with Wall Street circles, instead spending all of his time obsessively reading SEC prospectuses for mortgage-backed securities. This meant that the predominant collection of current Wall Street narratives like “there has never been a decade over decade decline in housing prices in American history” didn’t infect him. Indeed, it seems that the more isolated his position was, the happier he was. This didn’t mean he was completely free of being bombarded by the narrative. Burry’s investors, infected with the dominant narratives, constantly criticized him for his shorting of the Housing Bubble. He was vindicated at the end, making “$100 million for himself and $725 million for his investors”.
Yet he is singular for how unique he was. Most investors went happily off the cliff, carried away by a narrative that brought them huge wealth in the short-term but disaster in the long-term. My view has always been that, in the aggregate, culture lags behind events just as biology tends to lag behind events. But sometimes the day of reckoning comes quickly, even for the most successful of narratives. Priority and with it power can disappear very quickly.
Narrative crawls but history jumps.
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